The spring forecast, presented last week at the PCA Board of Directors Meeting in La Jolla, Calif., by chief economist Ed Sullivan, anticipates gradual gains throughout the second half of 2007, but not large enough to offset the year’s first half weaknesses. According to the PCA, the increased construction activity that is expected to begin mid-year, however, will carryover to 2008 and contribute to an estimated 3.9 percent growth in consumption.

Sullivan said gains in nonresidential and public construction will not be large enough to offset the harsh downward trends in the residential market. Sullivan’s 2007 projection reflects a nearly six million metric ton decline in residential cement consumption levels compared to 2006.
“Single-family start activity and residential cement consumption will not recover until the existing inventory level of homes is reduced,” Sullivan said.

Declines in construction are partially offset by rising cement intensity ?EUR??,,????'??+ the increasing use of cement and concrete in construction. Even with an overall decline in consumption, Sullivan sees a 1.5 percent increase in cement intensity in 2007. Cement intensity refers to the tons of cement per dollar of construction activity.